What does Rotana's entrance into the Arabic video on demand market mean for startups?

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The massive
popularity of online video streaming in the Arab world is
beginning to attract the attention of big companies looking for a
piece of the action. A newly-launched platform from Rotana Media Group – with a content
library befitting its conglomerate size – may well change Video on
Demand in the Middle East as we know it.

This month, Rotana, which manages a large group of radio and
television channels, launched a new internet platform for users in
the Arab world to watch free Arabic-language video content. Their
new “Rotana Cinema” offers
1,000 hours of entertainment content including movies, plays, and
television series.

The vice president of the group, Hassan Suleiman, cites
increasing regional “internet consumption habits” as the principle
reason for Rotana’s decision to “build an internet platform to
complete our television platform [to better serve] all our viewers
and clients.”

But Rotana’s move could threaten smaller-scale startups, largely
because it offers its content for free. Other platforms
like Cinemoz and Istikana
already exist, but the main difference between the three platforms
is in content. Cinemoz, a Lebanese platform launched in the summer
of 2011, is known for offering short movies, a category often
neglected in the Arab entertainment scene. By contrast, Istikana
mainly focuses on full television shows. Premium content on both
Cinemoz and Istikana operates on a subscription basis.

Rotana’s content is free, something Andreas Roell, CEO of EGM
Worldwide, Rotana’s digital partner feels in non-negotiatible. “We
think that Arab TV and movie lovers have the right to enjoy their
cultural and entertainment heritage for free; the model relies on
advertiser support,” he says.

“This is just the first stage,” says Suleiman. “We will
launch the second one in August with the largest online library for
Arabic videos and movies ever.” Roell confirms that they will soon
launch Rotana Cinema for mobile, tablet, and Smart TV to offer the
same experience across platforms.

A brief test drive of Rotana Cinema went smoothly: the archive
of Rotana Media Group includes a lot of movies, both new and old,
the quality is good, and the platform works well. While this new
release may not bode well smaller Video on Demand player, it
appears to be an improvement for the regional media consumer.

What do you think? Can video streaming startups compete
larger and more-established media companies? Let us know in the
comments section below.